April 12, 2013

Legislative Notes for ASHNHA members; compiled from hearings, reports, news accounts and good old fashioned face to face discussion in the Capital City

Hospital Trauma Fund Cut in Half by Legislature

The $2 million trauma fund was whacked in half by the Legislature’s conference committee last night. The conference committee, led by Representative Alan Austerman and Senator Pete Kelly, split the difference between the zero balance in the House and the $2 million fund proposed by the Governor. The Department had sought a permanent source of funds for this program that helps hospitals seek and maintain trauma designation.

One million dollars is not enough to maintain the current funding to the seventeen hospitals that are anticipated to be designated as level II, III or IV trauma centers during FY2013.

The cut was a surprise because Senator John Coghill, the sponsor and champion of this legislation, expected the $2 million fund would be appropriated.

The Conference Committee also gave Commissioner Streur unprecedented authority to transfer up to $50 million dollars between programs. ASHNHA will be talking to the Department about ways to address the Trauma fund shortfall given this authority.

We will carefully watch for inappropriate transfer of this funding responsibility to the Disproportionate Share Hospital or DSH program. Last year the Department proposed regulations to pay for Trauma fund obligations to eligible facilities out of Medicaid DSH. ASHNHA expressed strong opposition to this approach, especially if it interfered with the current primary obligation of DSH in Alaska. Currently the DSH funds are used to fund emergency psychiatric response at Providence, Fairbanks, Bartlett and API.  
In addition, we are expecting the Secretary of DHSS to release regulations in the very near future which will dramatically change DSH allocations under Medicare and Medicaid. The PPACA called for a 75% reduction in current DSH allocations with the remainder to be redistributed by a formula determined by the Secretary.

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Behavioral Health Grants Cut, but not as Much

The biggest brouhaha in the operating budget this year was the proposed $8.3 million reduction to community behavioral health programs. The Conference committee decided to reduce that Program by $2 million instead—still a noticeable reduction.

The Complex Behavioral Health Collaborative was funded for another year with $450,000 in one time funds.

Capital Budget in the Works

We await with anticipation, along with all stakeholders, the House version of the capital budget. The nearly final version will need to be released tonight because it needs to be heard by the Committee and on the floor tomorrow if there is to be a timely adjournment at midnight on Sunday.

Anchorage Medicare Clinic gets Permanent Funding

At press time, the Conference Committee was still discussing the final resolution of the Anchorage Medicare Clinic funding. However, it is clear that the project will receive around $1 million a year in perpetuity to meet operating obligations.

The clinic was started in Anchorage to serve seniors who could not see a primary care physician and now employs two full time physicians with a third to be added soon. Dr. George Rhyneer, Alaska Physicians and Surgeons, Alaska State Medical Association, Providence and ASHNHA all supported the founding of the clinic three years ago. Alaska Regional now has a seat on the Medicare Clinic Board.

Medicaid Funding Flat this Year

As we have reported earlier, the Medicaid budget funding outlook is essentially flat for next year, a major change from previous years of double digit growth. The Department will be looking for aggressive ways to manage costs to keep within that no growth window.

The Conference Committee did fund a portion of the “wood work” effect costs—these are funds to pay for the increased Medicaid enrollment that is expected in January 2014 as the individual mandate becomes more publicized, and as new eligibility rules for the existing Medicaid population rolls out—the MAGI calculation and the elimination of asset tests for populations under 65.

Looks Like a lot of Paperwork

Rep Wes Keller introduced a bill yesterday which is meant to incent hospitals and professional providers to join a network. Here is the wording of one section of the bill—no joke-

The health care insurer shall pay amounts due under a health insurance policy for covered services rendered by an out-of-network provider by check made out to both the provider and the covered person as joint payees requiring endorsement by both the provider and the covered person.  
As we read this section, if you are an out of network provider you will need the patient’s endorsement or signature on the actual check to cash an insurance payment.

Further, in another section of the bill, the insurer may pay a patient directly if the patient provides clear and convincing evidence that they have already paid.

If this seems cumbersome and very difficult to administer, that is the intent – to get more providers in network.

Premera Blue Cross of Washington and Alaska is reported to have asked Representative Keller to introduce the legislation since it was introduced by request. They have indicated it is a “conversation starter.” The legislation will be taken up next year.

Legislature Considers Big Move on 47,000 School District Covered Lives

With two days left in the session, the powerhouse Senate Finance is spending precious time daily on a bill that was introduced two weeks ago. This bill would fundamentally change how school district employees and their dependents obtain their health insurance.  
SB 90 and its companion HB 196 would mandate that school districts across the State purchase their insurance through the State of Alaska Employee Health Plan. The measure, if enacted would almost quadruple the size of the active state employee pool. Currently 6,400 active State employees and 10,000 dependents are covered outside of union trusts. This bill would add 47,000 employees and dependents.
The sponsor of the bill in the Senate, Senator Mike Dunleavy, wrote the following in a sponsor statement to explain the bill:
This larger insurance pool places the State of Alaska in a position to negotiate a more favorable employee health care insurance plan. By moving school districts into an integrated state plan, the state and school districts benefit from the economies of scale.

Currently each school district must obtain its own insurance coverage; consequently, the level of coverage and the cost of premiums vary widely throughout the state.
Some school superintendents have expressed strong support as a way to contain health care costs.
Teachers –about 5,800 of them and their 11,000 dependents –are covered currently by the NEA Union Trust which was formed in 1996. NEA strongly opposes the bill—fairly understandable since it would wipe out their union trust. Local 71 which represents other school district employees and covers them through a Trust also opposes the bill.
NEA indicates they had a zero percent cost increase in their premium and less than 10% each year for the last 15. In their own defense they take a swipe at the Alaska State Department of Administration as having a restrictive, antiquated procurement and bargaining process and poor management of the current plan.
Some mayors are reportedly not enthusiastic about this plan because it diminishes the pooling power of the Borough who would still have many employees outside of school districts to cover. Included in that pool are municipal hospitals. ASHNHA has asked for the bill to be held and reviewed between now and the next session.
Of course, there is an undertone of union busting in the conversation as well.

Legislature Meets in Joint Session on Governor’s Appointments

Board of Dental Examiners:
Robyn Chaney from Dillingham
Dr. Mary Nativsky from Sitka
Dr. Steve Scheller from Fairbanks
Gail Walden from Wasilla
Board of Nursing:
Hannah Espera from Anchorage
Thomas Hendrix from Eagle River
Board of Physical Therapy:
Dr. Darin Bell from Seward
Ruth Kostik from Juneau
Valerie Phelps from Anchorage

Medical Board:
Kevin Luppen from Wasilla
Kathleen (Carsey) Miller from Anchorage
Dr. Grant Roderer from Anchorage

Mental Health Trust Authority Board of Trustees:
Paula Easley from Anchorage
Russell Webb from Anchorage

Board of Pharmacy:
John Cotter, Fairbanks

ANTHC Bonding Legislation Poised to Pass Legislature

As previously covered in LegNotes, Senate Bill 88 has moved to the House Floor and should be passed by the Legislature before they adjourn Sunday night. This legislation authorizes the state bond committee to issue certificates of participation to finance $ 35 million for the construction and equipping of residential housing to serve the Anchorage campus of the Alaska Native Medical Center. Furthermore, the legislation authorizes the Department of Administration to enter into a lease-purchase agreement for the benefit of the Alaska Native Tribal Health Consortium.

The measure appealed to lawmakers because while the State Treasury would pay about $3 million each year that would be more than offset by Medicaid patients being served in the tribal system instead of the private system where reimbursement is 50/50.

After passing the Senate unanimously last week the bill had a brief hearing in House Finance where it moved out of Thursday. The bill now goes to the House floor for a vote and then (provided no amendments are made) goes to Governor Parnell to sign into law.

Newborn Screening for Congenital Heart Defects Heading for Final Vote

Senate Bill 87 by Senator Micciche (R-Kenai) moved quickly through the House after passing the Senate on Monday. The bill requires the attending provider of a birth - whether in a hospital setting, birthing center or home birth - to administer a pulse oximeter test to all newborns to detect congenital heart defects. Not only did the bill pass unanimously but thirteen Senators signed onto the bill as cosponsors. ASHNHA worked to get the bill streamlined regarding reporting –which was the major concern of the Legislative Committee. With those changes being made we have supported this legislation.

Save the Date

We’re headed to Nome for the ASHNHA Annual Meeting. ASHNHA has reserved a block of rooms at the Aurora Inn and Suites. To reserve your room, please email Barb at with your name, phone #, check in and check out dates. Event registration, agenda highlights and recommended airline flights coming soon! We hope to see you in Nome.


Jon Sherwood, who has been a chief Medicaid policy advisor to the Department of Health and Social Services for over 20 years is moving to a new role in the Department - Deputy Director of the Division of Senior and Disability Services.

Nice to See History Unfold

On a personal note, it was nice for me to see the Legislature honor Con and Nellie Miller by naming two bridges after them in North Pole Alaska. I grew up in North Pole, about a mile from the Santa Claus House which they built and the Miller family still owns. (Imagine growing up near Santa’s workshop.) Later my first job in State government in 1981 was my position in the office of Terry Miller their son, who was Lt Governor to Governor Hammond. Both the Miller sons—Terry and Mike served as Senate President. Terry died too early several years ago.

Alaska is a special place since we get to see people we grew up with honored for their service to our growing state.

CMS Announces Funding Opportunity for Insurance Marketplace Navigators

This week CMS announced grant funding for navigators to help people enroll in the federally run and partnership health insurance exchanges aka Health Insurance Marketplace. $600,000 is available to Alaska to help with this component of the Affordable Care Act. This funding opportunity is available to entities serving consumers in states, such as Alaska, with federally funded or state partnership exchanges. The application due date is July 7, 2013 with an anticipated award date of August 15, 2013. ASHNHA will host a coordination teleconference next week for interested entities. Please let Karen know if you would like to participate.

Click here to read the Funding Opportunity Announcement.

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